Tata Steel has shown interest in setting up a Rs 6,000 crore (Rs 60 billion) steel plant in the port city of Visakhapatnam in Andhra Pradesh.
B Muthuraman, managing director, Tata Steel, met Andhra Pradesh Chief Minister YS Rajasekhara Reddy in Hyderabad on Saturday and discussed the company's investment plans in the state.
"This included a proposal to set up a steel plant. Besides sharing their future investment plans, Muthuraman sought infrastructure support from the state government," a government official told Business Standard.
The size of the investment means Tata Steel can set up a plant with a capacity of about 3 million tonnes of steel per annum.
Botcha Satyanarayana, the state's minister for major industries, said, "Tata Steel has expressed its willingness to invest over Rs 6,000 crore in Visakhapatnam if the government extends the necessary infrastructural support."
According to Satyanarayana, Muthuraman has asked for 4,000 acres of land for the proposed plant, besides other basic infrastructure.
"Our government is very positive towards the investment plans of Tata Steel in the state and we will support them in the best possible way," he said.
Tata Steel has also indicated it may invest in other areas, especially in the north coastal region of the state. Manganese mining could be one such area.
The company is apparently targetting the iron-ore mines in Chattisgarh for iron-orefor the proposed steel plant.
It could also bring iron-ore from Orissa, where Tata Steel has signed an MoU with the state government in November to set up a 6 million tonne steel plant at a cost of about Rs 15,400 crore (Rs 154 billion),in two modules of three million tonnes each.
Tata Steel had recently signed a joint venture agreement with Larsen and Toubro to develop a deep-water port in Orissa at a cost of around Rs 1,500 crore (Rs 15 billion), to ensure availability of world-classport infrastructure to support the plant. The plant could use the port to bring in iron-ore from Orissa.
The decision to invest in the port city comes when the state-owned Visakhapatnam steel plant itself is expanding capacity to about 5 million tonnes, from the existing 3 million tonnes, involving an investment of Rs 3,000 crore (Rs 30 billion).
- The size of the investment suggests the plant will have a capacity of about 3 million tonnes per annum
- Tata Steel has indicated it may invest in other areas, especially in the north coastal region of the state
- Tata Steel has asked for 4,000 acres of land for the proposed plant, besides other basic infrastructure facilities